Gold Hits Record Highs: Is a Reversal Looming?Gold Returns to All-Time High: Is a Major Correction on the Horizon?
🔍 Strong Reaction at Historical Highs
Gold has returned to its all-time high zone, and as it touched this level, prices have seen a significant reaction, dropping $20 to around $2,770.
On the H4 timeframe, candles show strong selling pressure at the highs, signaling a potential deeper correction. As the market opens next week (Monday), there is a high likelihood of a GAP (price gap) forming on smaller timeframes due to the current momentum.
📊 Technical and Fundamental Insights
Double Top Formation:
Gold shows signs of forming a Double Top pattern at its historical peak.
Combined with technical signals, this suggests a possible short-term corrective wave.
Crucial News from FED and Trump:
Next week, the market anticipates critical updates from the Federal Reserve (FED) regarding interest rate policies.
President Trump’s fiscal and monetary policy announcements could also drive significant volatility in gold prices.
Low Liquidity Conditions:
With many Asian nations entering their Lunar New Year holidays, market liquidity is expected to decline, potentially leading to heightened volatility.
🌟 Price Behavior Analysis
Based on insights from DXY, SWAP CHARGE, and FVG analyses:
DXY Weakness: While DXY's weakness supports gold, heavy selling pressure near the highs indicates a possible corrective phase.
SWAP CHARGE Shifts: The shift from buying to selling suggests that selling pressure is currently dominant, supporting the likelihood of a gold correction.
💡 Key Levels to Watch Next Week
Resistance:
$2,786 - $2,790: This is the previous all-time high and a critical resistance level. A breakout above this zone could trigger a stronger bullish trend.
Support:
$2,758 - $2,735 - $2,718 - $2,694: These are the major support zones to monitor in case of a deeper correction.
📢 Conclusion:
Given the current dynamics, gold appears poised for a potential correction after testing its all-time highs. This aligns with technical signals and fundamental developments. Traders should closely monitor key levels and upcoming announcements from the FED and President Trump to stay ahead of market movements.
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